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The announcement that the US is ready to start negotiations in 2010 to join an expanded Trans-Pacific Strategic Economic Partnership (currently comprising NZ, Chile, Brunei, and Singapore, commonly known as the P4 Agreement), with 2011 as the target to seal the deal, confirms that it will be used as the backdoor means to secure a US/NZ Free Trade Agreement.

That would be catastrophic for any remaining economic sovereignty that New Zealand has. CAFCA says this not because we are “anti-American”. All such FTAs – such as with the existing P4 partners, or the more recent ones with Malaysia, the Gulf States and Hong Kong - pose the same threat to a greater or lesser degree. And our opposition to them is not because of “xenophobia” but for well founded grounds that they simply enmesh NZ more and more tightly in a cobweb of transnational corporate control.

So it’s a recipe for disaster to enter into an FTA with the biggest economy in the world, headed by a Government that aggressively pushes the interests of American Big Business (there is a seamless flow between the US Government and US Big Business, as is evidenced by the trillion dollar bailout of the mega-greedy financial sector, a textbook example of socialism for the rich).

A full blown US FTA will:

Remove any remaining “restrictions” on foreign investment, as the US regards NZ’s (purely token) oversight regime as “discriminating” against US transnational corporations, even though the Government has promised to further “liberalise” the Overseas Investment Act, a law which is in danger of being liberalised to death. push up the price of medicines by potentially hundreds of millions of dollars a year by attacking Pharmac; make access to digital recordings more expensive, and copying more restricted; attack our GE controls and food labelling, weaken our controls on food imports where they might carry diseases.

It is always presented as a means of getting NZ agricultural products into the US market. Ask Australian sugar cane growers how successful they were in getting their product into the US under the US/Australia FTA. The Americans have a simple policy when it comes to “free trade” – do as they say, not as they do. In other words, they want the world’s markets opened up to their products, while keeping their own heavily subsidised agribusiness sector fully or heavily protected from outside competitors.

Both National and Labour myopically see a US FTA as being the Holy Grail of their adherence to the cargo cult of “free trade”. It’s actually a poisoned chalice and it will be New Zealand which will be poisoned by it.

“One of New Zealand's biggest vegetable processors, Cedenco failed under the weight of high debts and problems with its shareholding and "governance", with unspecified problems relating to its ultimate owners in the United States. The US-based Sayler family, which ultimately owns Cedenco, also owns a US company, SK Foods, which filed for bankruptcy protection this year. There is also an ongoing federal investigation into SK Foods, including bribery allegations” http://www.stuff.co.nz/business/industries/3046759/Cedenco-receivers-reassure-growers, 10/11/09.

The Overseas Investment Office can’t say that it wasn’t warned about the problems in the US arising from the bribery allegations. More than a year ago, when those bribery allegations first appeared in the NZ media, the Campaign Against Foreign Control of Aotearoa wrote to the OIO regarding whether the persons owning and operating Cedenco were of good character, as required by the Overseas Investment Act.

Our August 2008 letter is below, as is the reply we received from the OIO seven months later, in March 09, saying that it was satisfied that there was nothing to investigate. Yeah, right.

In light of this latest development, has the OIO undertaken any further investigation of the US owner of Cedenco?

This is another instance of the body charged with “oversight” of foreign investors turning a blind eye to anything that could be seen as an impediment to the relentless takeover of this country by transnational corporations. The OIO clearly sees its role as a rubberstamp, a facilitator of and advocate for those foreign investors, not an investigator or regulator. Things will only get worse when the Government further “liberalises” the Overseas Investment Act.

Letters from CAFCA to OIO and OIO to CAFCA are below

Murray Horton

Secretary/Organiser

CAFCA

Campaign Against Foreign Control of Aotearoa

Box 2258, Christchurch, New Zealand

cafca@chch.planet.org.nz

www.cafca.org.nz

28/8/08

Dear Overseas Investment Office,

As you will be aware there have been several very recent NZ media reports that an FBI affidavit has been filed in a US court alleging that Frederick Scott Salyer, the founder and CEO of SK Foods, encouraged a named US broker, over a four year period, to offer bribes to food companies such as Kraft.

For instance see:

http://tvnz.co.nz/view/page/425823/2011518

http://www.stuff.co.nz/northland/4659467a6668.html

SK Foods owns 100% of Cedenco in this country

According to the Companies Office, Frederick Scott Salyer is a director of Cedenco and SK Foods International is still 100% shareholder. So there is little doubt Salyer has control of Cedenco as outlined in the Act.

We are fully aware that Mr Salyer is innocent until proved guilty.

Our question for the OIO is: what will you do if he is found guilty?

This strikes us as a bona fide case where the good character provisions of the Act would apply.

We look forward to your reply,

Murray Horton

Secretary/Organiser

10/3/09

Dear Murray,

Thank you for your email of 28 August 2008 and for the information contained within it. Since receiving your information we have investigated your allegations and determined how best to proceed.

To the best of our knowledge, there have been no charges brought against either SK Foods or Mr Salyer - All charges to date have been brought against the broker (the payer of the bribes) and representatives of third parties (the recipients of the bribes). SK Foods and Salyer expressly deny any wrongdoing. We understand that investigations continue in the US.

With no charges having been brought against Salyer/SK Foods, there is nothing for the Overseas Investment Office to investigate at present. Accordingly, we are keeping a watching brief on the matter and will begin a formal investigation if and when charges are successfully brought against SK Foods or an individual with control of SK Foods.

An investigation would examine two issues:

1. Has Cedenco Foods complied with conditions of its 2004/2005/2006/2007 consents?

2. Has SK Foods complied with the conditions of its 2001/2003 consents?

It will have been a condition of each of those consents that the individuals with control of SK Foods remain of good character and not persons of a type listed in section 7(1) of the Immigration Act 1987. Any investigation would focus on whether these requirements remain satisfied.